Microsoft Is Not the New Apple

With its $7 billion bid for Nokia, Microsoft has crossed the Rubicon into being a vertically integrated mobile computing company with a hard road ahead.

With its $7 billion bid for Nokia's cellphone business, Microsoft has completed its transformation into Janus, a two-faced hardware/software giant that should scare away any potential partner.

Why would anyone else ever want to make a Windows Phone now? The hearty few still cranking out Windows tablets must see the writing on the wall.

In the new mobile markets, Microsoft aims to ape Apple. It wants to go it alone as the vertically integrated company creating new mobile products.

There's just one problem. Unlike Apple, it does not have an integrated team with an identity, history, and passion for integrated products.

I give Microsoft credit for its good work establishing a solid SoC team for the Xbox. But that group has a huge chasm to cross to ever compete with Qualcomm's Snapdragon or Samsung's Exynos. So I question the real advantage of a vertically integrated mobile group.

Clearly, Microsoft is in a tough spot. Android and Apple's iOS dominate the new mobile markets. Windows struggles for relevance, trying to beat BlackBerry for a distant third spot.

The acquisition of Nokia will not make its Windows Phone products any more compelling. Stephen Elop, Nokia's turnaround CEO from Microsoft, had already staked that company's future on being the premier maker of Windows Phones. For what it's worth, he got his wish.

Microsoft has a long history of reaping the majority of profits from notebooks and desktops, keeping its hardware partners locked into commodity products. That hand will continue to play out amid declining growth prospects. In the mobile era, the other big opportunity is in the cloud, but this is increasingly Linux territory.

The Windows giant has a long future ahead of it milking its traditional PC franchise and making some money in game consoles and Web services. But it's not the next Apple. It's just the next Nokia.

As to the Beta vs VHS battle, I'm old enough to remember that one. Sony had a big disadvantage right from the start: Beta was orignally only good for one hour, VHS was originally good for two hours. And very soon, many more than just two hours. Practically a no-brainer, for anyone wanting to use these VCRs for time-shift recording.

And also, even if the masses may not have obsessed over these other differences, VHS was designed from the start to support stereo sound, even BEFORE VHS HiFi, whereas Beta did not support stereo until much later, when they too introduced HiFi audio.

And one more. VHS would retract its heads during rewind, whereas Beta would not. This meant head wear and gunking up whenever you had to rewind a tape. Or you had to buy one of those separate rewind boxes.

I know that years down the road, Beta improved on all those fronts. But by then, VHS had won. If other OEMs thought along the same lines as my obsessions of the day, you can see why they picked VHS.

Same can happen here, right? Unless Microsoft does something very uncharacteristic, I don't see why they would want to become a closed shop. Even if they will be one of the hardware players.

I still don't see that, Junko or Rick. Microsoft is hardly the only company building super portable tablet-like devices with Windows 8, even if it's one of the players in that field. If you consider the Surface Pro as a tablet, then what about Asus, Lenovo, Acer, Razor, HP, etc., who build very similar devices?

I wouldn't assume that just because Microsoft buys Nokia phones, that no one else will be permitted to build a Windows phone. I wouldn't put a negative spin on this, at the outset. Microsoft might very well NOT want to emulate Apple's closed shop environment. Doesn't mean these tablets and phones can't succeed. They seem to have gotten good reviews.

I know this from my humble experience of having worked at JVC -- which inveted VHS but needed help from OEMs to sell VCRs and promote VHS.

Sony also looked to sign up system OEMs adopting Betamax in hopes of presenting a united front of Betamax camp, but the company never managed to get the level of support and commitment from its OEM partners.

The art of managing "partners," and the human psychology behind it, never changes, even after the world has gone digital.

I think Rick outlines the challenges Microsoft faces correctly in his questions above.

In other words, the context of the story is not about whether Microsoft will succeed with Surface Pro, etc. (vs. Apple). Rather, a bigger question is if Microsoft will successfully change its tried and tested business model traditionally heavily dependent on its PC OEMs.

Apple never had that problem, because the Cupertino company has always done things on its own (or go it alone).

Meanwhile, Microsoft's past success is built on the Windows-faithful PC OEMs. Now that Microsoft builds its own tablets and phones, the OS giant is positioning itself as a competitor to many of its partner OEMs.

That business model switch is a bigger hurdle Microsoft needs to overcome, more than anything else, in my humble opinion.

That may be true, but perhaps they didn't give those products a chance.

The Surface Pro and the Windows phone appear to be competent products, by all accounts I've read. They need to stick it out. You can't expect a 50 percent market share a year or two after product introduction.

Bert wrote: Now [Microsoft is] getting serious about the hand held gadget market, and by all accounts, making decent products in that field. Including the Surface Pro and Windows phone. But it just got started.

Microsoft is by no means new to the hand-held gadget market. The Zune portable media player was introduced in 2006 and discontinued in 2011. The Kin phone was introduced in 2010 and discontinued within a year. Microsoft has tried to make in-roads in hand-held devices, but has yet to inspire the marketplace.

Companies reinvent themselves all the time, so there's no reason to think Microsoft can't do the same thing.

Apple was always a closed shop, unlike Microsoft, but so what? Apple went almost extinct, until Steve Jobs reinvented it from a very struggling walled garden PC maker to a fashion-trendy gadget company. It did stay "vertically integrated," but that's hardly enough to guarantee success.

Microsoft was just a software house for IBM. Then it became the premier software house for PCs and servers, becoming bigger than the IBM it was serving before. Weir, right? Now it's getting serious about the hand held gadget market, and by all accounts, making decent products in that field. Including the Surface Pro and Windows phone. But it just got started.

It wasn't long ago that the trade press could only gush about iPhones. Now the trade press has come to realize that Android is also a power to contend with, yet even that is a relatively new phenomenon, let's not forget. All Microsoft has to do is stick with it, and trhe marketplace will see another adjustment.

eewiz wrote: [Microsoft] didn't build the first browser yet has the most used browser now.

According to Wikipedia, Google Chrome has higher usage than Explorer. Explorer's share will only decrease as desktop PCs are used less. I'll let others compare Windows usage to Android and iOS, but if they haven't already overtaken Windows I suspect it will happen pretty soon. And if "popular" means that people "like the OS" rather than "are required to use the OS", I suspect that others are far more "popular".